Updated - 10:00 a.m. CDT
DuPont and Syngenta have announced the formation of a joint venture and licensing agreements that will offer farmers a new and broader access to each company's proprietary corn and soybean genetics and biotech traits. Syngenta Seeds Inc., and DuPont subsidiary Pioneer Hi-Bred International will form what the company's call the first 50-50 joint venture to out-license genetic traits to U.S. and Canadian seed companies, with potential to expand worldwide.
The two companies also agree to cross-license certain corn and soybean traits that each company will market independently under their own seed brands. The agreement includes rights for Syngenta to market the new Optimum GAT glyphosate tolerance trait recently developed by DuPont.
Some observers note that the move targets a specific competitor - Monsanto: "First, are we competing with Monsanto? You bet," says Mike Mack, chief operating officer, Syngenta Seeds. "We're going to jointly look forward to driving Optimum GAT and for Syngenta alone, we're excited and enthused about this technology. In 2009, when introduced, it will be the leading technology for soybeans, and Roundup Ready will have the No. 2 spot."
The joint venture - to be called GreenLeaf Genetics LLC, will offer corn and soybean material from both DuPont and Syngenta. It will also facilitate licensing of biotech traits by both companies. Syngenta originally launched GreenLeaf Genetics as a traits and licensing business in 2004.
Mack notes that the joint venture benefits farmers and seed companies by making traits more easily available across the marketplace. "We will be an out-licensor of proprietary germ plasm from Pioneer and Syngenta," he notes. "Seed companies, foundation houses and private labelers will benefit from this joint venture."
DuPont will, for the first time, offer other seed companies what it calls targeted access to its large plant genetics library. For Pioneer, the move is a major change in the market strategy, but one Dean Oestreich, president, says important. "The timing is right. It is really the right time to move into this. Our biotech pipeline is now maturing and these important technologies need to be driven broadly across the industry," he notes. "Were not giving away germ plasm. We will have control how these products are used and we'll be making decisions about what specific products we offer the GreenLeaf venture."
Herculex technology, which Pioneer developed in cooperation with Dow AgroSciences, will be licensed to other companies by Dow. Oestreich notes that if Dow wanted GreenLeaf to market those tools, they would need to make a separate agreement.
Through the licensing agreements:
- Syngenta receives a global license to the Optimum(TM) GAT(TM) trait, a DuPont proprietary glyphosate and ALS chemistry tolerant trait for both soybeans and corn to be marketed in conjunction with its Agrisure(TM) brand of traits. The new trait will give farmers expanded weed control options and help optimize yield. U.S. registration for the Optimum(TM) GAT(TM) trait is expected as early as 2009.
- DuPont receives a global license to Syngenta's insect resistance technology for European corn borer, corn rootworm and broad lepidopteran control as it develops the next generation of insect traits.
This is the second business agreement announcement this year between the two companies. In February, the two announced an agreement to broaden each company's crop protection product offering. Syngenta acquired an exclusive worldwide license to develop DuPont's new insecticide Rynaxypyr in mixtures with its own leading insect control products. DuPont Crop Protection acquired worldwide rights to Syngenta's strobilurin fungicide picoxystrobin, sold as Acanto, including access to companion products used in mixtures.